Cheniere's Q1 core profit, revenue beat estimates on strong LNG margins

Reuters
05-08
UPDATE 3-Cheniere's Q1 core profit, revenue beat estimates on strong LNG margins

Cheniere Energy beats estimates for core profit and revenue.

Company expects first LNG from second train expansion this month.

US/China trade war will not impact 2025 earnings, company says

Adds details from earnings call in paragraphs 2 and 5-11

By Curtis Williams

May 8 (Reuters) - Cheniere Energy LNG.N, the largest U.S. liquefied natural gas exporter, beat first-quarter estimates for core profit and revenue on Thursday, helped by rising prices for the superchilled gas as demand increased.

The U.S. is the world's top exporter of LNG and commercial activity in the sector has gained further momentum following President Donald Trump's lifting in January of a moratorium on new export permits.

Cheniere said first-quarter adjusted core profit, or EBITDA, rose 6% to $1.87 billion versus last year, which also beat analysts' average estimate of $1.64 billion, based on LSEG data.

The increase was mainly driven by higher profit margins as stronger market prices boosted returns compared with the same period in 2024.

Cheniere is expecting to produce the first LNG from the second of its seven-train expansion at its Corpus Christi, Texas facility, within a month, CEO Jack Fusco said in an earnings call.

Cheniere has been building a 10 million tonnes per annum (MTPA) expansion to its Corpus Christi export plant in Texas, called Stage 3, which consists of seven trains.

The company is also expecting that four of the seven trains will be completed before the end of the year, Fusco said. It had previously said it expected to finish three trains before the end of the year.

Cheniere expects to make a financial decision in a few months on another expansion project called Midscale 7 and 8, Fusco said.

Cheniere does not see its 2025 financial performance being impacted by the ongoing trade war between the U.S. and China and expects its Chinese buyers to purchase all their contracted cargoes, even if they sell some to third countries, said Anatol Feygin, Cheniere's Chief Commercial Officer.

Chinese buyers have been reselling their U.S. cargoes to Europe and other markets to avoid the reciprocal tariffs placed on LNG as part of the trade war between the U.S. and China.

Feygin said some European countries could face LNG price shocks because of their low gas storage levels and as Russian gas is not an option. He predicted, however, that Russian gas will flow to Europe again on the conclusion of the Ukraine war.

The company's total revenue for the first-quarter jumped 28% to $5.44 billion, beating estimates of $4.91 billion.

The reported quarter included a $725 million boost from increased Henry Hub-linked LNG contract pricing and $428 million from stronger short-term marketing sales amid elevated global gas prices, the company had earlier said in a filing.

Cheniere reaffirmed its 2025 financial forecast of adjusted EBITDA between $6.5 billion and $7.0 billion, and distributable cash flow between $4.1 billion and $4.6 billion.

The company reported LNG revenue of $5.31 billion for the three months ended March 31, compared with $4.04 billion a year ago.

(Reporting by Arunima Kumar in Bengaluru, Curtis Williams in Houston; Editing by Shailesh Kuber, Arun Koyyur and Jane Merriman)

((Arunima.Kumar@thomsonreuters.com; Twitter: https://twitter.com/Aru_Kumar94 ;))

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